Jet Airways Sends Employees On Leave Without Pay, Enforces Salary Cuts For Some: Report
The Jalan-Kalrock Consortium(JKC), which won the contract to revive the airline, had to implement some severe cost-cutting measures, which include wage reductions and unpaid leave for many of the 230 employees of its workforce.
The comeback of Jet Airways 2.0 has encountered uncertainty six months after receiving the Air Operator Certificate to launch commercial flying operations. The Jalan-Kalrock Consortium(JKC), which won the contract to revive the airline, had to implement some severe cost-cutting measures, which include wage reductions and unpaid leave for many of the 230 employees of its workforce.
The changes will be effective starting December 1 next month. Around 70 out of the 230 employees of the halted Jet Airways 2.0 will be placed on unpaid leave or will experience pay reductions of up to 50%.
The affected employees are beginning to doubt the consortium’s competence or intentions to raise and infuse the finances necessary for the airline’s resurrection.
According to a source who is aware of the recent discussions, the changes won’t affect nearly half of the employees, according to Moneycontrol.
According to a source who is aware of the recent discussions, the changes won’t affect nearly half of the employees, according to a report by Moneycontrol. The source stated that even the CEO of Jet Airways, Sanjiv Kapoor, has accepted to undergo a significant wage cut.
It may be mentioned that on November 18, CNBC-TV18 reported that Jet Airways has placed 60% of its staff, which included senior managers, on unpaid leave, after which Kapoor claimed on Twitter that the rumour was 100% fake. Kapoor also, in an effort to ease tensions, tweeted that none was being dismissed.
The news comes on the same day that Jalan-Kalrock Consortium, the company that won the bid to buy the unprofitable Jet Airways after it gained approval from the National Company Law Tribunal (NCLT), issued a statement in which it hinted that it could need to make tough decisions soon.
The consortium stressed that the JKC has not put off implementing the resolution plan and that it is abiding entirely by the agreed plan.
Jalan Kalrock Consortium (JKC), who had won the bid to restart the grounded airline under India’s bankruptcy law, has yet to do so because of a dispute over who whether consortia or lenders should be responsible for sharing past financial obligations to various stakeholders, including Jet 1.0 employees.
Jalan Kalrock Consortium (JKC) had said that while they wait for the company to be transferred in accordance with the NCLT procedure, the longer than anticipated wait period may require some difficult but urgent near-term decisions to manage their cashflows to protect the future while the airline is still not in their possession. The consortium stressed that the JKC has not put off implementing the resolution plan and that it is abiding entirely by the agreed plan.
Meanwhile, CEO of Jet Airways, Sanjiv Kapoor, stated that with the projected October 2022 launch in mind, they have placed a highly experienced professional management team and secured good terms for their many supplier contracts that can frequently be important in the business. And they have letters of intent (LOIs) in place for all the services necessary to operate an airline, including engines, ground operations, catering, call centres, and IT systems.
He further said that the terms reached will make Jet Airways, in its revived form, one of the most economically efficient airlines in the nation by leveraging the team’s experience from numerous Indian and foreign airlines as well as that of Jet Airways as a whole from the past.
JKC described the procedure, stating that following the NCLT’s permission, all conditions specified in the resolution plan were satisfied by May 20, 2022, and the required filings were submitted before the NCLT on May 21, 2022.
JKC described the procedure, stating that following the NCLT’s permission, all conditions specified in the resolution plan were satisfied by May 20, 2022, and the required filings were submitted before the NCLT on May 21, 2022. JKC has already compensated the lenders’ Rs 150 crores as required by the court-approved resolution plan, and the remaining sums won’t be invested until NCLT has completed its remaining tasks in relation to the transfer of the company to the consortium.
The JKC has submitted an application to the NCLT indicating that it won’t pay any more than the Rs 475 crore agreed in its settlement plan. The court had ordered former Resolution Professional Ashish Chhawchharia to calculate these amounts and inform the consortium of them within a month. However, JKC has asked the court to clarify in the application if the winning consortium has been ordered to pay these dues.
Edited by Prakriti Arora
